Copyright © 2006 Pearson Education Canada Inc. Appendix to Part 1 Consumer Behaviour and Marketing...

Copyright © 2006 Pearson Education Canada Inc.

Appendix to Part 1Consumer Behaviour and

Marketing Strategy

Consumer Behaviour

Canadian Edition

Schiffman/Kanuk/Das

Copyright © 2006 Pearson Education Canada Inc. Appendix-2

Steps in Developing a Steps in Developing a Marketing StrategyMarketing Strategy

Segment the Market Choose a Target Market

Decide on a Position for the Product

Develop a SuitableMarketing Mix

Find Ways to SatisfyAnd Retain Customers


Market SegmentationMarket Segmentation

The process of dividing a potential market into distinct subsets of consumers and selecting one or more segments as a target market to be reached with a distinct marketing mix.


“Best” Customer Segmentation

High Current Share Low

“

High

Low

Consumption

Lo Lows(starve)

Hi Highs(stroke)

Low Highs(chase)

Hi Lows(tickle)


Purposes of Segmentation Studies

To discover the needs of specific consumer groups to develop specialized products to satisfy specific group needs (e.g., Centrum http://www.centrum.ca)

To guide the repositioning of a product (e.g., Nintendo http://www.nintendo.ca)

To identify the most appropriate media for advertising (e.g., People and Teen People)


Bases for Segmentation Geographic Segmentation Demographic Segmentation Psychological Segmentation Psychographic Segmentation Socio-cultural Segmentation Use-Related Segmentation Usage-Situation Segmentation Benefit Segmentation Hybrid Segmentation Approaches


(continued)


Figure A-2 (continued)

(continued)


Figure A-2 (continued)


Geographic SegmentationGeographic Segmentation

The division of a total potential market into smaller subgroups on the basis of geographic variables (e.g., region, province, or city).


Demographic Segmentation Age

Sex

Marital Status

Income, Education, and Occupation


Marital Status

Households as a consuming unit– Singles– Divorced– Single parents– Dual-income married


Psychological Segmentation

Motivations Personality Perceptions Learning Attitudes


AIOsAIOs

Psychographic (lifestyle) variables that focus on activities, interests, and opinions.


Socio-cultural Segmentation

Family Life Cycle Social Class Culture, Subculture, and Cross-Culture


Family Life Cycle

Phases families go through in their formation, growth, and final dissolution– Bachelorhood– Honeymooners– Parenthood– Post-parenthood– Dissolution

Explicit basis: marital status, family status Implicit basis: age, income, employment


Use-Related Segmentation Rate of Usage

– Heavy vs. Light– Convert light users to medium or heavy users

• By identifying new uses for the product

– Attempt to satisfy heavy users well• By making sure the product continues to meet

their needs» continued


Use-Related Segmentation

Awareness Status– Aware vs. Unaware– Convert ‘unaware’ to ‘aware’

Brand Loyalty– Brand Loyal vs. Brand Switchers– Satisfy and reward brand loyal users

• By providing rewards for continued usage


Usage-Situation Segmentation

Segmenting on the basis of special occasions or situations

Example Statements:– Whenever I do well in a course, I treat myself with

-------.

– When I’m away on business, I try to stay at a suites hotel.

– I always take a bottle of French wine when I am invited to a friend’s house for dinner


Benefit Segmentation

Segmenting on the basis of the most important and meaningful benefit– Crest – Cavity prevention– Sensodyne – Gentle on sensitive teeth– Topol – removal of tobacco stains


Hybrid Segmentation Approaches

Psychographic-Demographic Profiles Geodemographic Segmentation SRI Consulting Group’s Values and

Lifestyle System (VALSTM)


Criteria For Effective Targeting of Market Segments

Identification Sufficiency Stability Accessibility


Segmentation Strategies Concentrated Marketing

– focusing on one target market alone– Suitable for small or new companies

Differentiated Marketing– Focusing on several segments at the same

time– Suitable for financially strong companies with

a several offerings in a product category» continued


Segmentation Strategies

Counter-segmentation Strategy– Merging two or more segments into one larger

segment– When target markets do not warrant separate

strategies anymore– When consumer needs become more similar

over a period

Copyright © 2006 Pearson Education Canada Inc. Appendix to Part 1 Consumer Behaviour and Marketing...

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